By Jonathan Stemple
March 4 (Reuters) – Allstate must face a privacy lawsuit that accuses home and auto insurers of illegally tracking drivers through their cellphones without consent, using their data to raise premiums or deny coverage, and selling the data to other insurers.
In a ruling Tuesday, U.S. District Judge Jeremy Daniels in Chicago said that drivers in the proposed class action could prove that Allstat violated federal wiretapping laws by monitoring their travel locations, distance traveled, speed, acceleration, braking, phone use and attention to the road, and attempted to obtain benefit data.
Drivers can also try to show that Allstate’s data analytics unit Arity violated the federal Fair Credit Reporting Act by falsely reporting their driving behavior, including when they were riding as passengers.
According to the complaint, Arity’s tracking software was integrated into apps such as Fuel Rewards, GasBuddy, Life360 and Allstate-owned Routely.
The judge also allowed the driver to pursue claims under the laws of 20 US states. He dismissed three of the drivers’ 38 claims.
Insurers such as Allstate, Progressive and Berkshire Hathaway’s Geico use so-called telematics to monitor drivers’ habits. They say technology rewards good driving through lower premiums.
Allstate argued that drivers never claimed that it actually captured their data, or that their insurance rates went up. It also stated that its privacy policy disclosed the possibility of data collection.
“Consumers who choose to share driving data through Arti-powered apps can access emergency assistance, track fuel efficiency and unlock personal insurance quotes after a clear notification and transparent opt-in process,” Allstate said in a statement Wednesday.
Attorneys for the plaintiffs did not immediately respond to requests for comment.
The lawsuits join 15 private lawsuits against the Northbrook, Illinois-based insurer. Texas filed a similar lawsuit against Allstate in January 2025.
(Reporting by Jonathan Stempel in New York; Editing by Mark Porter)
